Bitcoin Rallies Above $28,300—Is This The Peak?
Chris Vermeulen | Dec 29, 2020 12:23AM ET
It seems Bitcoin has been busy while the markets have been resting! Bitcoin enthusiasts are adamant that the price rally has just started a parabolic move higher. From a technical standpoint, this current rally certainly appears to have gone parabolic. As any trader already understands, what goes up may eventually come crashing downward.
My research team and I believe failure at the current highs would represent a clear technical divergence pattern between price and the RSI indicator. Additionally, the current rally that started on December 20 consists of a $10,850 rally phase. The previous rally that took place from October 20 to December 2 consisted of a $9,200 rally phase. We believe this current rally phase from December 11 could be a Wave 5 rally (almost equal to the Wave 3 rally range). If our researchers are correct, this final rally phase could come crashing downward after reaching these peak levels above $28,000.
This 4 Hour Bitcoin chart highlights the incredible price rally that has taken place over the past 16+ days—a rally of over $10,000. It also highlights two very clear price rally phases—creating an A-B-C price wave pattern.
This Daily Bitcoin chart highlights the two, almost identical in size, that we believe has created a price peak above $28,000. It also highlights the technical divergence between price and the RSI indicator in the lower pane.
We believe this current peak may become a near term top in Bitcoin—possibly resulting in a downward price decline. Critical support near $18~$20k is still very valid. If Bitcoin prices collapse from these peaks, we believe the $18k to $20k level will become the next level for price to find support.
Overall, this incredible rally in Bitcoin prices before the end of 2020 has certainly proved the Bitcoin skeptics wrong and set the enthusiasts on fire. At this point, we get to see what happens in early 2021 and if this $28k level will hold up. One thing is certain, the past 30+ days have shown a massive rally potential in Bitcoin and other Cryptos—is this an excess phase peak or the start of a massive uptrend in 2021?
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.